Flutter Entertainment cuts US guidance, cites customer-friendly results

The owner of FanDuel said that following its third-quarter earnings on 12 November, continued strong US player momentum has been offset by a period of "very unfavourable" US sports results across the rest of November and in December. This was mainly on NFL Parlay and Same Game Parlay outcomes.

Flutter noted that the 2024/2025 NFL season to date has been the most customer-friendly since the launch of online sports betting, with the highest rate of favourites winning in nearly 20 years.

As a result, the company now expects 2024 US revenue to be around $370m lower than its previous guidance midpoint at approximately $5.78bn. It had previously guided to between $6.05bn and $6.25bn.

After incremental one-off cost mitigation, adjusted EBITDA for the year is set to be around $205m lower than the previous guidance midpoint at approximately $505m, versus $670m to $750m.

At 1010 GMT, the shares were down 2.5% at 20,010p.

Russ Mould, investment director at AJ Bell, said: "Customers have cleaned up from bets on US sporting events, causing Flutter to issue a warning about a hit to earnings and triggering a sell-off in its shares. London-listed rival Entain also fell in sympathy as investors fretted that it too might upset with its next round of earnings.

"America was meant to be the land of opportunity for Flutter but it hasn’t quite worked out that way since moving its primary listing to New York last year. Downgrading US revenue and earnings estimates is a disappointment for the company and it will no doubt focus management’s minds on finding new ways to get back on top.

"There is a phrase in the gambling sector that says, ‘The house always wins’ and while this wasn’t true for Flutter in recent months, the company will be hoping it reverts to form as soon as possible."